Norilsk Nickel Foresees Notable Decline in Nickel Deficit in 2018

The nickel prices, after performing weakly during the first half of 2017, managed to recover during H2 2017, on the back of robust global stainless and alloys demand.

SEATTLE (Scrap Monster): One of the world’s largest refined nickel producers, Norilsk Nickel, has announced robust financial results for full year 2017. The consolidated revenues surged higher significantly by 11% year-on-year to $9.1 billion, mainly on the back of higher metal price realizations. The EBITDA was up by 2% to total $4 billion.

According to Vladimir Potanin, President, Norilsk Nickel, 2017 was an exceptional year of performance for the company. Firstly, the upgraded Talnakh concentrator reached its nameplate parameters. The year also marked expansion of Nadezhda smelting capacities and Kola refining facilities. The company was also successful in launching the Bystrinsky project in Zabaykalsky Kray-one of the largest mining operations in Russia.

The nickel prices, after performing weakly during the first half of 2017, managed to recover during H2 2017, on the back of robust global stainless and alloys demand. The average nickel price increased nearly 8% in 2017 to $10,411 per ton. Global Nickel consumption too has increased by almost 5% during the year, whereas the global nickel supply increased by 2%. The company expects the global nickel deficit to reduce to 15,000 tons in 2018 from 105,000 tons in 2017, despite anticipated solid demand growth. The anticipated economic growth in all key regions is likely to result in solid nickel demand in 2018. In the long run, battery sector is expected to turn out as the key driver of global nickel consumption growth.

The contribution of Nickel sales to the Group’s total metal revenue dropped from 34% in 2016 to 27% in 2017, owing to reduction in sales volume on account of reduced metal production from third party feed. Lower sales volume also contributed to 12% decline in nickel revenues during the year. The sales volume of nickel produced from Russian feed dropped sharply by 10% to 206,000 tonnes.